QUESTION 5 Weston Corporation has just made a dividend payment of $1.50 per share. The company anticipates that the dividend will increase by 6% annually. What is the maximum amount you should pay to purchase a share of Weston's stock if your goal is to earn a 13% rate of return? $23.86 $20.43 $21.68 $22.71 $23.45 QUESTION 6 Patagonia's common stock is selling for $31.26 a share. The stock has just paid $1,35 per share. Patagonia company has established a pattern of increasing its dividends by 7% annually and expects to continue doing so. What is the market rate of return on this stock? 12.14% 11.62% 11.27% 10.83% C10.51% QUESTION 7 Norfolk Corporation earned $12.6 million for the fiscal year ending yesterday. The firm also paid out 40 percent of its earnings as dividends yesterday. The firm will continue to pay out 40 percent of its earnings as annual, end-of-year dividends. The remaining 60 percent of earnings is retained by the company for use in projects. The company has 4.2 million shares of common stock outstanding. The current stock price is $30. The historical return on equity (ROE) of 10 percent is expected to continue in the future. What is the required rate of return on the stock? (Hint: use the retention ratio and HOE to estimate the growth rate) 10.24% 9.87% 9.519 9.20% 8.869